Question 21.21. Phil & Bill each own a 50% interest in P&B Interests. P&B Interests has ordinary income for the year of $35,000 before guaranteed payments to Phil. If Phil receives guaranteed payments of $25,000 during the tax year, what is the total income or loss that should be reported by Bill from the partnership for this tax year? (Points : 1)

$5,000 income $17,500 income $25,000 income $30,000 income None of the other provided choices

Question 22.22. Barbara receives a current distribution consisting of $2,000 cash plus other property with an adjusted basis to the partnership of $2,300 & a FMV on the date of the distribution of $7,000. Barbara has a 10% interest in the partnership & her basis in her partnership interest, immediately prior to the distribution, is $5,000. What is Barbara's basis in the non-cash property received in the current distribution? (Points : 1)

$2,000 $2,300 $3,000 $7,000 None of the other provided choices

Question 23.23. Jim's basis in his partnership is $200,000. His share of the 2014 income is $60,000. The partnership gave him a $75,000 distribution in 2014. What is his new basis in the partnership & what is his taxable income? (Points : 1)

$200,000; $75,000 $260,000; $60,000 $140,000; $60,000 $185,000; $60,000 $185,000; $135,000

Question 24.24. Salix Associates is a partnership with an October 31 year-end. For the fiscal year ended October 31, 2014, Salix Associates reported ordinary income of $100,000, after deducting guaranteed payments. Max, a calendar year taxpayer, is a 30% partner in the partnership & received $2,000 monthly as a guaranteed payment for the calendar year 2013, along with $2,100 monthly for the calendar year 2014. What is the total income from the partnership that Max should report on his 2014 individual income tax return? (Points : 1)

$30,000 $54,200 $55,000 $55,200 None of the other provided choices

Question 25.25. Jordan files his income tax return on a calendar-year basis. He is the principal partner of a partnership reporting on a June 30 fiscal year end basis. Jordan's share of the partnership's ordinary income was $24,000 for the fiscal year ended June 30, 2014, & $72,000 for the fiscal year ended June 30, 2015. How much should Jordan report on his 2014 individual income tax return as his share of taxable income from the partnership? (Points : 1)

$24,000 $36,000 $48,000 $72,000 None of the other provided choices

Question 26.26. Under which of the following circumstances would a partnership terminate and close its tax year? (Points : 1)

Divorce of a partner Sale of an interest in a partnership by a partner who holds a 60% capital & profits interest Entry of a new partner Distribution of property to a 10% partner in complete termination of the partner's interest in the partnership None of the other provided choices

Question 27.27. Kitty is a 60% partner of Tabby Associates. She sells a building to the partnership for $75,000. If the building had an adjusted basis to Kitty of $95,000, how much gain or loss does Kitty recognize on this transaction? (Points : 1)

$95,000 loss $20,000 loss $0 gain or loss $20,000 gain None of the other provided choices

Question 28.28. Barry owns a 50% interest in B&B Interests, a partnership. His brother, Benny, owns a 35% interest in that same partnership & the remaining 15% is owned by an unrelated individual. During 2014, Barry sells a rental property with a basis of $60,000 to B&B Interests for $100,000. The partnership intends to hold the rental as inventory for resale. What is the amount and nature of Barry's gain or loss on this transaction? (Points : 1)

$40,000 long-term capital loss $0 gain or loss $40,000 long-term capital gain $40,000 ordinary income None of the other provided choices

Question 29.29. Owen owns 60% of the Big Time partnership. He sells to the partnership a machine for $70,000 that has a $45,000 basis. What would the taxable income be for Owen and what is the partnership's basis in the machine? (Points : 1)

$25,000; $45,000 $0; $45,000 $25,000; $70,000 None of the other provided choices are correct

Question 30.30. Wallace & Pedersen have equal interests in the capital & profits of the partnership of Wallace & Pedersen, but are otherwise unrelated. On August 1, 2014, Wallace sold 100 shares of Kalmia Mining Corporation to the partnership for its FMV of $7,000. Wallace had bought the stock in 2000 at a cost of $10,000. What is Wallace's deductible loss for 2014 as a result of the sale of this stock? (Points : 1)

$0 $1,500 long-term capital loss $3,000 long-term capital loss $3,000 ordinary loss None of the other provided choices